Baker v Poucette, 2016 ABQB 557

Court of Queen ’ s Bench of Alberta Citation: Baker v Poucette, 2016 ABQB 557 Date: 20161004 Docket: 1201 07380, 1201 07668 Registry: Calgary Action No. 1201 07380 Between: Mary Baker, Litigation Representative of the Estate of Bradley Jason Baker, Dylan Owen Baker, an infant by his Mother and Litigation Representative, Mary Baker and the said Mary Baker Plaintiffs - and - Newton Lerrence House Poucette Defendant Action No. 1201 07668 And Between: Tylena House Plaintiff - and - Mary Baker, Litigation Representative of the Estate of Bradley Baker, Deceased, Shelly Kunzel, and Newton Poucette Defendants _______________________________________________________ Reasons for Judgment

of the Honourable Mr. Justice R.A. Neufeld _______________________________________________________ Table of Contents Introduction . 3 a. Court Actions . 3 b. The 1201-07380 Action: Baker v Poucette . 3 Issues . 4 Background . 4 a. The Baker Family . 4 b. The Accident 5 Liability . 6 a. Onus of proof . 6 b. Credibility . 8 c. Reliability . 8 i. Reliability of Mr. Heymerdinguer 8 ii. Reliability of Mr. Poucette . 11 d. Decision on Liability . 12 e. Contributory Negligence . 14 Damages . 16 a. FAA Bereavement Claim .. 16 b. Pecuniary Loss . 16 i. General Principles . 16 ii. Loss of Dependency . 18 c.

Decision on Loss of Dependency . 27 d. The Set-off Issue . 28 e. Accelerated Inheritance . 29 f. Income Tax Gross Up . 30 g. Pre-judgment Interest 30 h. Mrs. Baker’s Claim for Personal Loss of Income . 30 Conclusion . 32 Introduction [ 1 ] On November 5, 2010, Bradley Baker (“Mr. Baker”) died when the motorcycle he was driving collided into the rear-end of a Chevy half-ton truck driven by the Defendant, Newton Poucette (“Mr. Poucette”).

a. Court Actions [ 2 ] Three actions were filed in relation to this accident: 1201-07380, 1201-07668 and 1201-08218. On February 17, 2015, Millar, J ordered that the three actions be tried at the same time for the purposes of liability. He also ordered that they be heard concurrently by the same trier of fact for purposes of determining damages, pursuant to rule 3.72(1) (

b) of the Alberta Rules of Court , Alta Reg 124/2010 [ Rules ]. [ 3 ] In the main action, Baker v Poucette (1201-07380), Mr. Baker’s wife, Mary Baker, and his son, Dylan Baker, seek damages from Mr. Poucette. This is the action that formed the basis for the trial underlying these Reasons. At trial, Mary Baker was referred to by her counsel as “Mrs. Baker”; I will use that same term in this decision. [ 4 ] In 1201-07668, Tylena House v Baker, Kunzel, and Poucette (“ House v Baker ”), a Partial Discontinuance of Claim was filed on April 15, 2016 as against Mrs.

Baker and Shelly Kunzel, but continued as against Newton Poucette. This action is subject to a Mary Carter agreement whereby the Court’s decision in the main action, Baker v Poucette , will be the decision in House v Baker as well. [ 5 ] Action number 1201-08218, Poucette v Kunzel and Baker, was discontinued on March 7, 2016. [ 6 ] The use of the term “Plaintiffs” in these Reasons refers to the Plaintiffs in 1201-07380, being Mrs. Baker in her own right and in her various representative capacities. The term “Defendant” refers to Mr. Poucette. b.

The 1201-07380 Action: Baker v Poucette [ 7 ] The Plaintiffs say that the accident, in which Mr. Baker died, was caused entirely by the negligence of the Defendant, Mr. Poucette. They rely primarily on the evidence of a following driver, Craig Heymerdinguer (“Mr. Heymerdinguer”), who witnessed the collision. The Plaintiffs claim: (1) damages for sorrow and bereavement; (2) damages for loss of income for Mrs.

Baker while she was on long term disability; (3) special damages; and (4) a major grouping of damages for past and future economic contributions to the Baker household, including: past and future loss of housekeeping and exterior home maintenance, and loss of dependency for household income, and financial services. The Plaintiffs say that these dependency loss damages should be based upon Mr. Baker’s ability to earn an income equal to or greater than that of his one-time profession as a teacher. [ 8 ] Mr. Poucette maintains that he was at no fault in the accident.

He also argues that in the event that he is found liable, damages should be based on Mr. Baker’s reported earnings as an entrepreneur in the decade preceding his death rather than his much higher earning capacity as a school teacher. Issues [ 9 ] There are two main issues to be determined: first, who is liable for the accident; and second, if the Defendant is found liable, what amount of damages should be awarded.

Background [ 10 ] Before addressing in detail the issues of liability and damages, it is useful to provide contextual information regarding the Baker family, as well as the circumstances leading to the accident in which Mr. Baker lost his life. a. The Baker Family [ 11 ] Mr. Baker was born in 1954, and was 56 years old at the time of his death. His wife, Mrs. Baker, was born in 1956 and their son, Dylan Baker (“Dylan”), was born in 1996. Mrs. Baker and Dylan were 54 and 14 years old, respectively, at the time of the accident. [ 12 ] Following graduation from university in the early 1980’s, both Mr. and Mrs.

Baker pursued teaching careers. In 1998, Mr. Baker left teaching, taking stress leave following a disagreement over workload with the Principal of the junior high school where he worked. He moved on to work for a family-owned business, and then embarked on different business ventures of his own. The most important of these was a Mortgage Investment Corporation (“MIC”) that Mr. Baker formed in 2003, Copestone Capital Inc. (“Copestone”), and a separate building and land development company, Nu-Terra Investments Corporation (“Nu-Terra”), which Mr. Baker established in conjunction with two partners. [ 13 ] While Mr.

Baker operated Copestone, Mrs. Baker continued her teaching career, eventually reaching the highest level of pay commensurate with a teacher of her experience. Unlike Mr. Baker who cashed out his pension entitlement upon quitting the profession, Mrs. Baker earned a significant pension entitlement. [ 14 ] In the 10 years prior to his death, Mr. Baker reported relatively meagre income to Revenue Canada, ranging from a low of $0.00, in 2000, to a high of $20,100, in 2010. [ 15 ] According to Mrs. Baker, her late husband was a loving and active husband and father.

Aside from his business ventures, he kept busy performing his household duties, and was very involved in Dylan’s school and sporting activities. They had a solid and loving marriage. [ 16 ] As a result of Mr. Baker’s death, both Mrs. Baker and Dylan suffered profound grief and personal loss. Six years later, they are much recovered, but in the immediate aftermath of the accident, Mrs. Baker took disability leave from teaching due to stress and

Dylan struggled at school. [ 17 ] Compounding her personal loss was Mrs. Baker’s discovery that Copestone was in financial disarray. Mrs. Baker found that the company did not have the financial ability to deliver to its investors the returns that they had expected and considered themselves entitled to receive. Over the ensuing year, her attempts to keep the company afloat, including injecting her own money to cover investor payments, failed. Also ending in failure was an attempt, in conjunction with the co-owners of Nu-Terra, to acquire a development site in Red Deer.

They hoped to use that site as security for a mortgage that would have potentially allowed Copestone to secure monies previously loaned to Nu-Terra without registration of mortgages. [ 18 ] For Mrs. Baker, the year following the November, 2010 accident was, therefore, one that included immense personal loss, a need to help her child deal with his own grief, a growing realization that her late husband’s business was a failure, and, ultimately, witnessing that business being petitioned into receivership by two of its investors. [ 19 ] Mr. Baker had never shared the details of his financial problems with his wife.

According to Mrs. Baker, Mr. Baker enjoyed the business world and had no immediate plans for retirement. She believes that Mr. Baker would have been able to maintain the confidence of Copestone’s investors and that they would have been more patient in allowing him to find solutions to the problems faced by his company than they had been with her. [ 20 ] Mrs. Baker also stated that a return to teaching was considered by the both of them to be an option that Mr. Baker could fall back on if necessary. b. The Accident [ 21 ] On November 5, 2010, the day of the accident, Mr.

Baker took his sister-in-law’s touring motorcycle for a ride. At about 3:00 p.m. on a pleasant and sunny day, he was travelling east on Highway 1A. The road was bare and dry. After passing the turn-off to Ghost Lake Village, a residential community, Mr. Baker found himself behind a truck. The truck was driven by Mr. Heymerdinguer, who had just entered Highway 1A from Ghost Lake Village. Mr. Baker passed Mr. Heymerdinguer’s vehicle travelling at approximately 100 kilometres per hour (“km/h”), which was 20 km/hr faster than the posted speed limit. [ 22 ] As Mr.

Baker proceeded east, he approached a gentle curve in Highway 1A, which was approximately 1.5 kilometers (“km”) to the east of Ghost Lake Village. The area of the curve is notable for three reasons: 1. It is the location of an entrance to the Stoney Medicine Lodge (a community center, the “Lodge”) located to the north of the highway; 2. It is near that entrance that Highway 1A widens due to the presence of vehicle-width shoulders on both lanes (versus much narrower shoulders to the west); and 3.

It is near that entrance (approximately 50 metres (“m”) west) that the speed limit for eastbound travel increases from 80 km/hr to 100 km/hr. [ 23 ] As Mr. Baker approached the curve in Highway 1A, he was followed by Mr. Heymerdinguer, who variously estimated his following distance at 50 m (in a police interview conducted after the accident) and then at 85 m (at trial). [ 24 ] Coming at them from the east were two oncoming vehicles. The first was a motorcycle. Mr. Baker waved to the rider of the motorcycle as they passed each other.

The second was an off-duty, Nakoda Nation, ambulance, driven by Thijs Vogelzang (“Mr. Vogelzang”) . Mr. Vogelzang observed the exchange of waves between the motorcyclists. He also observed, in his side view mirror, the accident that happened mere seconds later. [ 25 ] At some point as Mr. Baker neared the entrance to the Lodge, it seems that Mr. Baker noticed that a truck was in his path; this truck was driven by Mr. Poucette (the “Poucette truck”). [ 26 ] There is conflicting evidence as to where the Poucette truck was initially located. Mr.

Poucette insists that he was in a stationary position in the eastbound lane while waiting for oncoming traffic to pass, and that he had just begun to execute his left-hand turn to the Lodge entrance. Mr. Heymerdinguer, however, was equally insistent that the Poucette truck was stationary on the shoulder, and that Mr. Poucette pulled onto the highway in front of Mr. Baker before commencing his turn. [ 27 ] Although it appears that he tried to avoid the collision, Mr. Baker’s motorcycle collided into the Poucette truck. Mr. Baker died at the scene of the accident.

Liability [ 28 ] Both liability and damages need to be determined in this action. The liability component of this decision turns primarily on which of the two versions of the accident I consider to be the most reliable. [ 29 ] The damages component of this decision turns primarily on the determination as to what Mr. Baker’s career path and associated income would have been had he not died when he did. Damages will be discussed following my decision on liability. a. Onus of proof [ 30 ] At common law, the onus of proof in cases involving rear-end collisions ordinarily belongs to the following driver.

The following driver must prove on a balance of probabilities that the accident was not caused by his or her negligence.

[31] In this case, however, since the driver of the lead vehicle, Mr. Poucette, was charged and convicted of an offence under theTraffic Safety Act, RSA 2000, c T-6 [TSA], the Plaintiffs argue that

section 185 of the TSA applies. This

section shifts the onus to theconvicted driver (Mr. Poucette) to prove that the accident did not occur due to his negligence. [32]

Section 185 of the TSA states: If (

a) a person sustains loss or damage arising out of the operation of a motor vehicle on a highway, and (

b) that motor vehicle is operated by a person who is in contravention of or fails to comply with this Act, the onus of proof in any civil proceeding that the loss or damage did not arise by reason of that contravention or failure to comply is onthe owner or driver of the motor vehicle. [33] Mr. Poucette acknowledges that he bears the onus of proof, but argues that the onus was discharged on the evidence, andfurthermore, that his guilty plea and conviction are not determinative of the issue in any event.

He cites, for this proposition, Lowe vLarue, (AB KB), [1998] 6 WWR 760 (ABQB), aff’d 2000 ABCA 28 [Lowe]. [34] Following its accident investigation, the RCMP recommended that charges be laid against Mr. Poucette. As part of theinvestigation, Constable Brad Laschuk interrogated Mr. Poucette. He also interrogated Tylena House (“Ms. House”), who was Mr.Poucette’s common law wife (she is now deceased) and who was a passenger in the Poucette truck at the time of the accident. Initially,Mr. Poucette was charged with careless driving under section 115(1)(

b) of the TSA, which states: For the purposes of this section, a driver of a vehicle is driving carelessly if that driver drives the vehicle [...] (

b) without reasonable consideration for persons using the highway. [35] The section 115(1)(

b) charge was later reduced to a charge under section 15(1)(

b) of the Use of Highway and Rules of theRoad Regulation, Alta Reg 304/2002 [Highway Regulation], which reads: When operating a vehicle on a highway, [...] (

b) in the case of a highway in an urban area where a single solid line only exists between traffic lanes, a person shall not drive thevehicle so that the vehicle or any portion of the vehicle crosses the single solid line from one traffic lane to another except whenovertaking and passing another vehicle; [...]. [36] It is unclear why section 15(1)(

b) was chosen, given that the accident occurred in a rural, not an urban, area. At the trial of thecivil action, Mr. Poucette acknowledged having pleaded guilty to this charge; he said that his lawyer advised him to do so. [37] Lowe, which was cited by the Defendants as authority that a TSA conviction is not determinative of the issue of onus, can bedistinguished given the facts in that case. According to the evidence accepted by the Court of Queen’s Bench in Lowe, the Plaintiff hadsuffered a head injury in a collision.

The court also found (para 8): At the hospital she was given a ticket by the Lethbridge City Police for failing to wear a seat belt. She says, and I believe her, that shedoes not even remember seeing the ticket. It was paid within a very few days personally by her companion, the witness Bente Hansenwho did it as a favour and who did it without the instructions, consent or knowledge of the plaintiff.

In her cross-examination, thewitness Hansen said the plaintiff told her after the ticket was paid, she, Hansen, should not have done so. [38] In Lowe, the conviction was as a result of a third party paying the ticket without the Plaintiff’s knowledge, while in thecurrent case Mr. Poucette entered a guilty plea himself, and was represented by counsel in doing so.

Furthermore, in Lowe, credibleevidence was accepted by the trial judge that the Plaintiff routinely wore her seatbelt and that she could never remember a time that shehadn’t. [39] On appeal, the Court of Appeal held that: “The weight accorded the respondent's conviction was more than overcome by theevidence that the respondent customarily wore her seat belt. The trial judge's conclusion amounted to a finding that the respondent wasnot in breach of the Highway Traffic Act, and s. 179 did not apply” (para 21). As I am equally as unpersuaded by the Defendant in thiscase, the onus is appropriately on Mr.

Poucette, pursuant to

section 185 of the TSA. [40] Despite my concerns over the confusing charge, the fact remains that Mr. Poucette - who had the advice of counsel - chose toplead guilty to an offence under the Highway Regulation. This serves to shift the onus of proof to Mr. Poucette in accordance withsection 185 of the TSA to demonstrate that the accident was not caused by his negligence. b. Credibility [41] In argument, counsel for Mr. Poucette referred the Court to the distinction between questions of credibility and reliability, asdiscussed in R v Morrissey (1995), (ON CA), 22 OR (3d) 514, 38 CR (4th) 4 (CA) (citing to OR). In that case, atpage 526, the court stated:

Testimonial evidence can raise veracity and accuracy concerns. The former relate to the witness's sincerity, that is, his or her willingness to speak the truth as the witness believes it to be. The latter concerns relate to the actual accuracy of the witness's testimony. The accuracy of a witness's testimony involves considerations of the witness's ability to accurately observe, recall and recount the events in issue. When one is concerned with a witness's veracity, one speaks of the witness's credibility.

When one is concerned with the accuracy of a witness's testimony, one speaks of the reliability of that testimony. Obviously a witness whose evidence on a point is not credible cannot give reliable evidence on that point. The evidence of a credible, that is, honest witness, may, however, still be unreliable. In this case, both the credibility of the complainants and the reliability of their evidence were attacked on cross- examination. [ 42 ] This is a useful starting point in assessing which of the two versions of the accident is to be accepted. In my view, both Mr. Poucette and Mr.

Heymerdinguer appeared to be credible witnesses; both told the truth as they understood it. [ 43 ] Mr. Heymerdinguer was steadfast in in his testimony that when he first noticed the Poucette truck, it was parked on the shoulder of Highway 1A, and that it suddenly moved out into the eastbound traffic lane before entering into a left-hand turn. His evidence at trial and statements given by him after the accident was consistent on that critical point. [ 44 ] Mr. Poucette was adamant that he was making a proper left-hand turn, commencing from a stationary position in the eastbound travelling lane.

He provided an adequate explanation for his decision to plead guilty to the Highway Regulation offence. While that decision may operate to shift the onus of proof to Mr. Poucette, it does not, in these circumstances, undermine his credibility in advancing his version of events. [ 45 ] In addition, the Court had the opportunity to carefully observe the videotaped evidence of Mr. Poucette`s reaction and demeanour when Constable Laschuk accused him of having been parked on the shoulder prior to the accident. In it, Mr.

Poucette reacted with genuine surprise – to the point of appearing to believe the suggestion to be a joke. This reinforced the credibility of his viva voce testimony in respect of that issue. c. Reliability i. Reliability of Mr. Heymerdinguer [ 46 ] While both Mr. Poucette and Mr. Heymerdinguer were credible witnesses, it does not necessarily follow that their evidence was reliable. [ 47 ] In support of their case generally, and the evidence of Mr. Heymerdinguer in particular, the Plaintiffs commissioned a report by Mark Sawa (“Mr. Sawa”), an accident reconstruction expert. Mr.

Sawa was engaged in September, 2015. To reconstruct the accident, he used accident scene and vehicle photographs taken by the RMCP, along with accident scene measurements collected in 2015. [ 48 ] Mr. Sawa used tire mark information to place the Poucette truck at a 60 degree counter clockwise rotation, partway across the centre line of the highway, at the time of impact.

He assumed that the Poucette truck was moving at a speed of 20 km/hr, which he considered a reasonable rate of speed to complete a left-hand turn, and which would explain a tire mark that was orientated in a north- south direction (which was agreed by both experts to have been made by the right rear tire of the Poucette truck). Based on the assumed rate of speed at impact of 20 km/hr, and the 15.28 m turning radius of the Poucette truck, Mr. Sawa concluded that Mr. Poucette must have commenced his turn from the south shoulder of Highway 1A, or at least, substantially within the south shoulder.

In support of his contention that the back of the truck was at a steep, 60 degree angle at impact, Mr. Sawa pointed to two other pieces of evidence: 1. Left-to-right color smears on the tailgate, indicative of a sideswipe collision in which the motorcyclist’s red, black and white leathers had run across the tailgate; and 2. Direct impact damage (reported by the Defendant’s reconstruction expert) as close as 38 centimetres (“cm”) from the centre point of the back of the truck.

When combined with the fact that the front wheel of the motorcycle itself had cleared the back corner of the Poucette truck prior to impact, this was said to indicate a sideswipe collision with the tailgate. [ 49 ] In reply, the Defendant commissioned a rebuttal report from Patrick Ryan (“Mr. Ryan”), who is also an experienced accident reconstruction expert. Mr. Ryan criticized Mr. Sawa’s analysis. In his view, the orientation of the Poucette truck at impact was in the order of 30 degrees.

This much shallower angle was, he said, consistent with the clear photographic evidence showing that the majority of damage to the Poucette truck was in a longitudinal direction. During his testimony, Mr. Ryan reviewed photographs of the Poucette truck, including of the rear bumper, the truck bed, the truck box and the truck cab, all of which demonstrated back-to-front longitudinal damage and was indicative of a direct, versus a sideswipe, collision. [ 50 ] Mr. Ryan stated that the physical evidence collected at the site could be used to explain either a 30 degree or a 60 degree angle.

He had run the same PC Crash Simulator as Mr. Sawa, with a 30 degree orientation assumed, and found it to produce essentially the same results. The difference was that for Mr. Sawa’s model to work, the Poucette truck needed to commence its turn on the south shoulder of the highway and accelerate to 20 km/hr, whereas Mr. Ryan’s analysis allowed for a conventional turn, commencing in the travelling lane (as was described by Mr. Poucette). [ 51 ] In discussing the other indicia of a sideswipe collision (fabric smears and damage commencing at 38 centimetres from the centre of the rear-end), Mr.

Ryan’s general explanation was that motorcycle collisions are very complex. He stated that such collisions are complicated by the dynamics of a motorcycle, which will move in side-to-side and upward-downward directions simultaneously. They are also complicated by the fact that a motorcycle and its rider may move differently before, during, and after a collision. Mr.

Ryan described the tire mark locations as being consistent with a low angle, rear-end collision, in which the corner of the vehicle struck is lifted and bounces down on the roadway as the vehicle moves and rotates. [ 52 ] In argument, the Defendant suggested that Mr. Sawa’s reconstruction was contradicted, not only by the evidence of Mr.

Poucette, but also by that of Mr. Heymerdinguer and Mr. Vogelzang (the westbound ambulance driver). The Defendant pointed out that according to Mr. Heymerdinguer, when he first saw the Poucette truck move, it was “crawling along”, “[i]t was almost like it just idled onto the road”. The Defendant argued that this is not consistent with a rapid acceleration to 20 km/hr from the shoulder to the centre line of the highway. [ 53 ] Mr. Vogelzang testified to seeing debris from the collision in his side view mirror, and seeing “a rear side profile of the vehicle”. This tends to support Mr.

Poucette’s version of the accident, but Mr. Vogelzang was unable to recall the exact orientation of the Poucette truck. [ 54 ] In addition to challenging Mr. Sawa’s support for Mr. Heymerdinguer’s version of the accident, the Defendant asserts that given the configuration of Highway 1A and the location of the vehicles on it, Mr. Heymerdinguer could not reliably have placed the Poucette truck on the shoulder of the highway prior to it commencing its turn. [ 55 ] The Defendant also commissioned a report by Dr. Donald Kline, an experienced expert in the field of transportation and human factors. [ 56 ] Dr.

Kline testified that humans detect potential collisions, and the corresponding need to take evasive action, by interpreting the rate at which the image of the object or surface in questions expands in their retina. The point at which this recognition occurs is the threshold rate of expansion (the “TRE”). [ 57 ] There is some difference in the scientific literature regarding the appropriate TRE to use in field applications, with the rate varying between 0.003 to 0.006 radians per second (“rad/s”, radians being the unit of measurement of expansion of an image on the retina).

In application, the point at which the TRE will be reached varies according to the size of the object observed, as well as the speed at which the observer is approaching that object. It will also vary somewhat if the object is being approached on a curvilinear path. Dr. Kline and Dr. Jeff Caird, an expert in human factors who testified on behalf of the Plaintiffs) agreed that the TRE of 0.003 rad/s of a 1994 Chevy half-ton truck is exceeded at approximately 133 m at 95 km/hr.

At 0.006 rad/s, it would be exceeded at approximately 94 metres. [ 58 ] By way of comparison, at 100 km/hr, the distances would be approximately 136 and 96 m at TREs of 0.003 rad/s and 0.006 rad/s, respectively. [ 59 ] This is important evidence. It indicates that an observant following driver would have recognized a vehicle stopped ahead as a collision danger at some point between 94 and 136 m, depending on the speed of travel and the TRE value is used (eg. 0.003 rad/s versus 0.006 rad/s).

At that point, the following driver would need to mentally process the collision danger information and execute a response (slowing down, braking, or swerving), all of which would need to be done in time to avoid the collision. The TRE phenomenon, therefore, assists our understanding of where following drivers may have been located at the time of detecting the collision danger caused by a stopped or slow moving vehicle.

It is of lesser value for determining whether and to what extent the driver of a following vehicle could place the lead vehicle’s lateral position on a roadway. [ 60 ] In respect of the latter issue, Dr. Kline testified he attended at the accident scene following his receipt of the Plaintiffs’ rebuttal report by Dr. Caird. He, like Dr. Caird, determined that a following driver would not be able to place the lateral location of a stationary truck until approximately 125 m from the crash site. This means that if Mr.

Heymerdinguer’s evidence on the starting position of the Poucette truck is to be accepted as reliable, the Court must be able to accept that the entire sequence of events leading to the accident, as described by Mr. Heymerdinguer, took place within 125 m of the crash site. Those events would have included: 1. seeing the Poucette truck stationary on the shoulder; 2. seeing the Poucette truck move “forward at a crawl” into the eastbound travelling lane; 3. commenting to his passenger that, “this ain’t gonna be good”; 4. releasing the accelerator and moving his foot to cover the brake; 5. observing Mr.

Baker swerve left as the Poucette truck entered the travelling lane; 6. observing the slow-moving Poucette truck commencing a left-hand turn, thereby cutting Mr. Baker off for a second time and causing him to swerve to the right; 7. observing the collision; 8. responding to the collision by applying his brakes, “hard”; and 9. bringing his vehicle to a stop prior to the collision site. [ 61 ] At the conclusion of his testimony, Dr. Kline confirmed that it was possible for Mr.

Heymerdinguer to have first seen the Poucette truck on the shoulder at 125 m and to have then stopped just in time to avoid the collision, but only “if he started right then.” [ 62 ] The reliability of Mr. Heymerdinguer’s evidence regarding the starting position of the Poucette truck also needs to be considered in comparison to other eyewitness testimony. [ 63 ] As mentioned earlier, Mr. Poucette’s testimony on the position of his vehicle was steadfast and consistent throughout.

In his interrogation by RCMP one week after the event, the suggestion that other witnesses had placed his truck as stationary on the shoulder clearly took Mr. Poucette by surprise. In addition, as emphasized by the Defendant in argument, there was no apparent reason for Mr. Poucette to place his family in danger by parking on the shoulder and thereafter, making his left-hand turn across two lanes of traffic.

Mr. Poucette was familiar with the road, he was making a routine visit to the Lodge to pick up his son from daycare, and he was barelyon time to do so without incurring late charges. [64] In reply, the Plaintiffs posited the theory that Mr. Poucette may have initially been stationary because of a concern that a left-hand turn across a double line was illegal or as a precaution against a rear-end collision. While the latter suggestion makes more sense, itwould not explain Mr. Poucette’s clear surprise at being accused of such a manoeuvre. ii. Reliability of Mr. Poucette [65] Mr.

Poucette’s version of the accident was simple and straightforward. He testified that he was en route to pick up his sonfrom daycare at Lodge, arriving at the turnoff to the Lodge shortly before the daycare pick up deadline of 3:00 p.m.. [66] At trial, he said that he stopped in the eastbound travelling lane, waited for four oncoming vehicles to pass and then releasedhis foot from the brake and started to accelerate into the left-hand turn. He testified that he had his signal light activated throughout; heturned it off only after the accident.

He said that partway through his turn, he was struck from behind by, what he later learned to be, themotorcycle driven by Mr. Baker. [67] Mr. Poucette’s evidence was largely corroborated by the videotaped statement of Ms. House, as well as her evidence atquestioning. This evidence was admitted into the record following a voir dire under the principled exception to the hearsay rule and rule8.14(1)(

a) of the Rules. [68] Mr. Poucette’s version of the accident was also corroborated, to some extent, by Mr. Ryan’s expert evidence, as discussedearlier. [69] In argument, the Plaintiffs pointed to several inconsistencies in Mr. Poucette’s recollection of the accident. First, he wasinconsistent with the number of vehicles that passed him going westbound before commencing his left-hand turn: in his November 5,2010 statement to the RCMP he said there were two cars and one ambulance, but in questioning and at trial he testified that he waited forfour vehicles. Mr.

Poucette’s story also changed as to whether or not he saw Mr. Baker’s motorcycle prior to the accident; in hisNovember 5, 2010 statement to the RCMP he said that he did see the motorcycle prior to the collision, but at questioning and at trial hetestified that he didn’t see the motorcycle before the collision. The third inconsistency they point to is Mr. Poucette’s different storieswith respect to the acceleration of his truck as between the RCMP statement, questioning, and trial. Finally, they argue that Mr.

Poucettewas inconsistent on the location of his truck on the highway when he was hit. [70] The Plaintiffs also argued that Mr. Poucette had a motive to lie about the accident, in order to avoid prosecutions particularlyduring the initial investigation phase, and that the Court should give little weight to his evidence, and to his wife’s evidence for the samereason. [71] The Plaintiffs also offered an alternative argument: if Mr.

Poucette had in fact commenced his turn from a stationary positionin the eastbound travelling lane (as opposed to the shoulder), that, in itself, was negligent because he did so without signalling and in an“incredibly slow” fashion, well after the last westbound vehicle had cleared. d. Decision on Liability [72] After careful review of all of the evidence, it is my view that, on a balance of probabilities, the accident was caused by twofactors: (1) a wide and inordinately slow left turn, unaccompanied by a left-hand signal, by Mr. Poucette; and (2) excessive speed by Mr.Baker.

I reach that conclusion for following reasons. [73] Turning first to Mr. Heymerdinguer. I find that, for the most part, his evidence was straightforward and unshaken on cross-examination. He was a confident witness, and his description of the accident was careful and detailed. [74] As emphasized by the Defendant, eyewitness testimony, no matter how credible, must always be considered with healthyskepticism. An event such as the one witnessed by Mr. Heymerdinguer is traumatic; it is only natural that over time the re-telling of sucha traumatic episode will embolden and entrench original perceptions.

If mistaken, these perceptions become less reliable over time,rather than more. [75] The Law Reform Commission of Canada commented, in the context of identification evidence, that recollections are: ...prone to error, because it is impossible for the brain to receive a total picture of any event. Since perception and memory are selectiveprocesses, viewers are inclined to fill in perceived events with other details, a process which enables them to create a logical sequence.The details people add to their actual perception of an event are largely governed by past experience and personal expectations.

Thus thefinal recreation of the event in the observer's mind may be quite different from reality. Witnesses are often completely unaware of the interpretive process whereby they fill in the necessary but missing data. They will relatetheir testimony in good faith, and as honestly as possible, without realizing the extent to which it has been distorted by their cognitiveinterpretive processes.

Thus, although most eyewitnesses are not dishonest, they may nevertheless be grossly mistaken in theiridentification. (as cited in R v Miaponoose, (ON CA), 30 OR (3d) 419, p 422, 93 OAC 115) [76] There was one component of Mr. Heymerdinguer’s recollection that, in my view, cannot be properly relied on: his testimonyon the positioning of the Poucette truck prior to commencement of its turn. While it may be true that accidents are sometimes the productof nonsensical actions, no on the evidence before me there is no logical explanation why Mr.

Poucette would have parked his vehicle onthe shoulder of the highway prior to starting his left-hand turn.

[77] I also do not accept the evidence of Mr. Sawa that the left-hand turn commenced from the shoulder, as he described in hisreport. As pointed out by Mr. Ryan, an equally plausible explanation of the tire marks at the scene would place the Poucette truck at anangle consistent with a turn from within the travelling lane, with that angle being more consistent with the physical damage done to thePoucette truck. [78] Mr.

Sawa’s assumption that the Poucette truck accelerated to 20 km/hr from its stationary position on the shoulder to itsposition at impact is not supported by any eyewitness evidence, including that of Mr. Heymerdinguer, Ms. Ryujin, Mr. Poucette, or Ms.House. [79] Finally, there is considerable doubt on the evidence that Mr. Heymerdinguer was within 125 m of the Poucette truck when hefirst noticed it in a stationary position. While that is a possibility, it is, in my view, doubtful that all of the actions listed earlier could orwould have taken place within the time period between Mr.

Heymerdinguer’s detection of the Poucette truck and his bringing his vehicleto a stop in front of the collision site. Mr. Heymerdinguer was, no doubt, multi-tasking to an extent, but his description of the eventsincluded an early recognition of movement on the part of the Poucette truck, commentary to his wife, observation of evasive manoeuvresby the motorcycle and, following the collision itself, application of brakes. This makes it unlikely that he first detected the Poucette truckat a distance of only 125 m, and, consequently, makes it unlikely that he saw it wholly within the shoulder.

Given the position of thePoucette truck on the curve of the highway, it would have been very easy to assume, without seeing, that it was stationary on theshoulder, especially if it was not signalling a turn at the time. In my view, this explains how Mr. Heymerdinguer could have formed hismistaken perception of the starting point of the Poucette truck. [80] Although I reject Mr. Heymerdinguer’s testimony regarding initial positioning of the Poucette truck, I accept the remainder asbeing accurate and reliable. [81] The evidence of Mr.

Heymerdinguer that I do accept is that the Poucette truck moved forward “at a crawl” toward the centreline and that it then turned left without signalling. The temporal element is somewhat consistent with the evidence of Mr. Poucette andMs. House. It is consistent with the fact that the Nakoda Nation ambulance was well along the highway (having passed both Mr. Baker’smotorcycle and Mr. Heymerdinguer’s truck) when the collision took place, even though it was the last oncoming vehicle to clear prior toMr. Poucette commencing his turn. The right-to-left movement described by Mr.

Heymerdinguer would be consistent with a wide turnbeing taken by Mr. Poucette, albeit not necessarily originating entirely on the shoulder of the highway. [82] In concluding that Mr. Poucette failed to activate his signal light, I have carefully considered the evidence of Mr. Poucette,Ms. House, and Mr. Heymerdinguer. While it was a difficult decision to make, in my view, the absence of a signal light helps to explain: 1. Why Mr. Heymerdinguer would have erroneously placed the Poucette truck on the shoulder, from a distance.

Had thesignal light been activated, he would likely have assumed the vehicle to be in the travelling lane, where a turn would more likelyoriginate; 2. Why Mr. Baker failed to notice the Poucette truck in sufficient time to avoid a collision; and 3. Mr. Baker’s indecision in first attempting to pass the Poucette truck on the left, and then on the right. [83] My findings regarding reliability should not be interpreted as a condemnation of Mr. Poucette or Ms. House’s honest belief intheir own testimony.

I found both to be credible, but they, too, suffered a traumatic incident, and their perceptions and recollections of theevents may have been honestly held, but ultimately unreliable, given the frailty of eyewitness testimony as described above. In addition,as noted by the Plaintiff, Mr. Poucette’s testimony contained a number of inconsistencies in respect of the events leading to the collisionwhich, in their totality, tended to cast doubt on the accuracy of his recollection. It is also important to note that, while not determinativeof fault, Mr.

Poucette pleaded guilty to, and was convicted of, an offence under the TSA in connection with this accident. [84] Taking all factors into consideration, it is my view that the primary blame for the accident belongs to Mr. Poucette. Inreaching that conclusion, I note that Mr. Poucette’s conduct was in breach of the Highway Regulation; he failed to use his indicator whilestopped in the travelling lane of a two-lane highway, and, as a result, he posed a danger to any following vehicle, not to mention himselfand his passengers. Mr.

Poucette’s conduct fell below the standard of care expected of a reasonable motorist in the circumstances. Hisnegligence caused Mr. Baker’s death. He is liable, subject to my contributory negligence findings below, for the damages caused by hisnegligence. e. Contributory Negligence [85] In his Statement of Defence, the Defendant contends that if he was negligent, Mr.

Baker should be found contributorilynegligent. [86] Apportionment of liability is governed by section 1(1) of the Contributory Negligence Act, RSA 2000, c C-27 (“CNA”): When by fault of 2 or more persons damage or loss is caused to one or more of them, the liability to make good the damage or loss is inproportion to the degree in which each person was at fault but if, having regard to all the circumstances of the case, it is not possible toestablish different degrees of fault, the liability shall be apportioned equally. [87] In Heller v Martens, 2002 ABCA 122 [Heller], the Court of Appeal confirmed that in apportioning liability, the Court shouldadopt the comparative blameworthiness approach.

This approach includes consideration of factors such as the nature of the duty owed bythe tortfeasor to the injured person; the number of acts of fault or negligence committed by a person at fault; the time of the variousnegligent acts; the nature of the conduct held to amount to fault; and the extent to which the conduct breaches statutory requirements: seeHeller, at para 34, citing Aynsley v Toronto General Hospital, (ON SC), [1968] 1 OR 425 at 444-45 (CA), aff’d (SCC), [1972] SCR 435; Arnold v Teno, (SCC), [1978] 2 SCR 287; Bruce v McIntyre, (ONCA), [1954] 2 DLR 799 (ONCA), aff’d (SCC), [1955] SCR 251; Chamberland v Fleming (1984), (AB

KB), 12 DLR (4th) 688 (ABQB); John G Fleming, The Law of Torts, 8th ed (Sydney: Law Book Company, 1992) at 273-74; Crothers vNorthern Taxi (1957), (MB CA), 10 DLR (2d) 87 at 100 (Man CA); Clyke v Blenkhorne (1958), (NSCA), 13 DLR (2d) 293 at 304 (NSSC). [88] In Heller, the Court of Appeal explained that (para 51): The purpose of the CNA is to apportion responsibility for conduct that does not meet the reasonable standard of care. [...] The “degree inwhich each person was at fault”, as enunciated in s. 1(1) of the CNA, relates to a wrongdoer’s blameworthiness in all the circumstances. [89] In Bradford v Snyder, 2016 ABCA 94, the Court of Appeal further explained that (paras 38-39): In order to establish contributory negligence, a court must find that the cause of the loss or damage to the plaintiff was the concurrentfault of both the plaintiff and defendant.

Once proven, the Contributory Negligence Act, s 1(1) applies such that "... the liability to makegood the damage or loss [caused by this accident] is in proportion to the degree in which each person was at fault...". This Court held in Heller v. Martens, 2002 ABCA 122 (Alta. C.A.) that the degree to which each person is at fault is determined usingthe "comparative blameworthiness" approach, which requires that a court examine "all the circumstances of the parties' misconduct todetermine their relative negligence": Heller at para 30.

In other words, apportionment is based on the degree to which each partydeparted from the standard of care. It is not based on the extent to which each party's conduct caused the damage. (2016 ABCA 94) [90] Although it was pled in defence, at trial, the issues of contributory negligence and comparative blameworthiness were notargued in significant detail. The Defendant did, however, contend that the accident would not have occurred but for the negligence ofMr. Baker by virtue of his excessive speed. The Plaintiffs replied that the Defendant had failed to show that Mr.

Baker’s excessive speedwhen entering into the curve on the highway was a cause of the accident. [91] There is no dispute between the parties that Mr. Baker (and, for that matter, Mr. Heymerdinguer) was speeding as he travelledeast on Highway 1A prior to the point, approximately 50 m west of the collision location, where the speed limit increases to 100 km/hr. [92] Had Mr. Baker been in compliance with the 80 km/hr speed limit and had he been paying closer attention, it is my view thathe may well have avoided the collision altogether. This is evidenced by the fact that even at a much higher speed, Mr.

Baker very nearlyavoided the collision. [93] Taking all factors into consideration, it is my view that the primary blame for the accident belongs to Mr. Poucette, while asecondary proportion of blameworthiness belongs to Mr. Baker. In reaching that conclusion, I note that Mr. Poucette’s conduct was inbreach of the TSA by failing to use his indicator, thereby posing a danger to any following vehicle. Mr. Poucette’s conduct fell below thestandard of care of a reasonable motorist in the circumstances. Mr.

Baker’s speeding, also conduct in breach of the TSA, primarilyendangered himself by making it more difficult to detect and respond to highway hazards. However, at the point of the collision itself,Mr. Baker’s speed was within posted limits. [94] Accordingly, I find the Defendant to be contributorily negligent, and I assign liability at 75%/25% as between the Defendantand Mr. Baker respectively. Damages [95] The Plaintiffs claim damages under the Fatal Accidents Act, RSA 2000, c F-8 [FAA], for a statutorily prescribed bereavementloss, as well as pecuniary loss.

Three types of pecuniary loss claims are made: loss of dependency income, loss of household services andspecial damages. Mrs. Baker also claims damages for loss of income following the accident due to her inability to continue teaching. a. FAA Bereavement Claim [96] There is no dispute regarding the bereavement claim advanced by Mrs. Baker and Dylan. They are entitled to damages forgrief and loss of the guidance, care and companionship of Mr. Baker. As a result, under

section 8 of the FAA, they are entitled to$75,000, for Mrs. Baker, and $45,000, for Dylan, prior to reduction to take into account Mr. Baker’s contributory negligence. b. Pecuniary Loss i. General Principles [97] The calculation of damages for pecuniary loss is one that must be conducted in a purely financial fashion.

In Royal Trust Co vCPR, (UK JCPC), [1922] 3 WWR 24, at 25-6, 67 DLR 518, Lord Parmoor of the Judicial Committee of the PrivyCouncil put it this way: When a claim for compensation to families of persons killed through negligence is made, the right to recover is restricted to the amountof actual pecuniary benefit which the family might reasonably have expected to enjoy had the deceased not been killed. It is notcompetent for a Court or a jury to make in addition a compassionate allowance. The principle, as stated by Lord Watson in Grand TrunkRy. Co. of Canada v. Jennings (1888), 13 App.

Cas. 800, is applicable in cases where the loss, in respect of which compensation isclaimed, is based on the cessation of an income derived from professional skill: It then becomes necessary to consider what, but for the accident which terminated his existence, would have been the reasonableprospects of life, work and remuneration; and also how far these, if realized, would have conduced to the benefit of the individualclaiming compensation.

The difficulty arises not in the statement of the principle, but in its application to a case in which the extent of the actual pecuniary loss islargely a matter of estimate, founded on probabilities, of which no accurate forecast is possible.

In the present case it appears to be the duty of the Court, following the lines laid down in the above and other cases, first to estimate asnearly as possible the capitalized value to the widow and child of the share which they would have enjoyed in the future earnings andprobable savings of the deceased, and then to deduct from the sum so ascertained the amount received for accident insurance, withproper allowances in respect of the life policies and in respect of the acceleration, by reason of the death, of the benefits coming to thedependents under the will of the deceased. [...] [98] The reference to life insurance policies is no longer applicable in Alberta, but the basic task as articulated by Lord Parmoorremains. [99] The estimation of pecuniary loss due to a wrongful death can be a daunting exercise.

No one can predict with certainty how aperson’s career might have unfolded had his or her life not been brought to an untimely end. In Mallett v McMonagle (1969), [1969] 2All ER 178, p 189, [1970] AC 166 (UKHL), Lord Pearce put it this way: Any assessment must contain elements of reasonable prophecy and arithmetic.

In assessing the proper figure, the jury have to take intoaccount both the possibilities for good and for bad, striking a fair balance as they see it, on such evidence of the future probabilities as isgiven to them. [100] In recognition of the inherent difficulty in projecting what the deceased’s financial contribution would have been, the SupremeCourt of Canada has held that a plaintiff need not prove, on a balance of probabilities, what the deceased’s income profile could havebeen.

Nonetheless, the Court must consider that: Hypothetical events (such as how the plaintiff’s life would have proceeded without the tortious injury) or future events need not beproven on a balance of probabilities. Instead, they are simply given weight according to their relative likelihood: Mallet v McMonagle,[1970] A.C. 166 (H.L.); Malec v. J.C. Hutton Proprietary Ltd. (1990), 169 C.L.R. 638 (Aust. H.C.); Janiak v. Ippolito, (SCC), [1985] 1 S.C.R. 146.

For example, if there is a 30 percent chance that the plaintiff’s injuries will worsen, then the damage awardmay be increased by 30 percent of the anticipated extra damages to reflect that risk. A future or hypothetical possibility will be taken intoconsideration as long as it is a real and substantial possibility and not mere speculation: Schrump v Koot, (1977), (ONCA), 18 O.R. (2d) 337 (C.A.); Graham v Rourke (1990), (ON CA), 74 D.L.R. (4th) 1 (Ont.

C.A.). (Athey v Leonati, (SCC), [1996] 3 SCR 458, at para 27, 140 DLR (4th) 235) [101] While projection of future income can be a difficult exercise in itself, the uncertainties inherent in such a predictive exercise arecompounded by the fact that recoverable loss is not a gross income stream. Rather, it is the proportion of that income that would nothave been consumed by the deceased for his or her own purposes.

This brings into play factors such as the income that the survivingspouse could have been expected to earn and the possibility that the surviving spouse might remarry. [102] It is also necessary to adjust the award to account for the fact that the claimant will be receiving a lump sum amount, rather thanreplacement of a stream of income over many years. Selection of a discount factor is in itself an inherently predictive exercise. ii. Loss of Dependency Expert Evidence [103] The Plaintiffs and Defendant each provided expert evidence to assist the Court in determining dependency loss. [104] Ms. Cara Brown (“Ms.

Brown”), an economist who has testified on many occasions before this Court and others, prepared alengthy report on behalf of the Plaintiffs. In it, she analyzed three future income scenarios: the first assumed that Mr.

Baker would haveearned an income similar to his average annual income over the ten years preceding his death; the second assumed that he would haveearned income from one or more entrepreneurial or business endeavours that would be equal to that which he could earn as an entry levelteacher on return to that profession; and the third was that he would return to teaching, initially earn an entry level salary, and thenprogress up the pay scale. Ms. Brown analyzed two different retirement ages (65 and 70) for each of these scenarios. [105] Mr. Darren Benning (“Mr.

Benning”) is a similarly qualified and experienced expert who prepared a report for the Defendant.Mr. Benning assessed the dependency loss on the assumption that Mr. Baker’s income would have been equivalent to his averageearnings in the eight years following his retirement from teaching –$15,399 (in 2010 dollars, including addbacks). At trial, Mr.

Benningpresented two sensitivity cases in which he assumed annual incomes of $30,000 and $50,000. [106] Both experts prepared and testified to rebuttal reports in which they critiqued and replied to each other’s primary reports. [107] The experts agreed that the prediction of Mr. Baker’s career path, had the accident not occurred, is the fundamental driver inany assessment of dependency loss. What Mr.

Baker’s career path would have been is a complex question requiring an analysis of Mr.Baker’s academic and work-related qualifications, his employment history, and the financial situation of his company at the time of theaccident. I will turn to the question of Mr. Baker’s career path before returning to assess the expert evidence presented by each party’seconomist. Mr. Baker’s Career History [108] Mr. Baker’s career history can be divided into three phases: teaching school; working in his family’s fabrication business (andoperating a small, cheque-writing venture); and owning and operating Copestone.

[ 109 ] His teaching career started in 1981 following his graduation from university with a Bachelor of Education degree. Mr. Baker taught junior high school science and math over a period of seventeen years. Near the end of that time period, he encountered difficulty when a newly-appointed principal at his school who demanded that he teach a full load of classes, while he continued to provide in- school information services support. Mr. Baker viewed that as unfair. [ 110 ] Mr. Baker took sick leave on September 21, 1998, followed by long term disability leave.

In 1999, he accepted early retirement under a general program offered by the Calgary Board of Education. Accepting early retirement allowed him to pursue other endeavours, while cashing out his pension entitlement. It also rendered academic a disciplinary investigation that had been initiated regarding his unauthorized access to the school’s information system. At the time of his retirement, Mr. Baker was earning approximately $60,000 per year. [ 111 ] From 1998 to 2004 Mr.

Baker pursued new career endeavours, including working for a fabrication company owned by a family member, and promoting a cheque-writing product – Cheque Tech – that he started with a friend. His reported income during this time frame was meagre, ranging from $0.00, in 2000, to $5,548, in 2004. His reported earnings to Revenue Canada from 1996 to 2010 are set out below: Year Employment Income Line 101(

a) Other Employment Income Line 104 (

b) Net Business Income Line 135 (

d) Net Professional Income Line 137 (

f) Total (a, b, d, f) 1996 $55,691 $0.00 $0.00 $0.00 $55,691 1997 $55,956 $0.00 $0.00 $0.00 $55,956 1998 $58,454 $1,328 $0.00 $0.00 $59,781 1999 $4,595 $11,496 $0.00 $0.00 $16,092 2000 $0.00 $0.00 $0.00 $0.00 $0.00 2001 $0.00 $0.00 $9,413 $0.00 $9,413 2002 $0.00 $0.00 $7,219 $0.00 $7,219 2003 $0.00 $0.00 $4,972 $0.00 $4,972 2004 $0.00 $0.00 $0.00 $5,548 $5,548 2005 $0.00 $0.00 $0.00 $5,845 $5,845 2006 $0.00 $0.00 $0.00 $13,889 $13,889 2007 $0.00 $0.00 $0.00 $16,757 $16,757 2008 $0.00 $0.00 $0.00 $3,434 $3,434 2009 $0.00 $0.00 $12,175 $0.00 $12,175 To Nov 5, 2010 $0.00 $0.00 $20,100 $0.00 $20,100 [ 112 ] In 2004, Mr.

Baker started Copestone. He also co-founded Nu-Terra with Mr. Lou Baisi and Mr. Les Baisi. [ 113 ] Copestone was to raise funds through RRSP-eligible investments. The funds would be used to provide loans to residential home developers. The loans would be secured by mortgages registered against title so that investors would not be exposed to the risk of building and land-development ventures. Investors were promised excellent returns (10 to 12% per annum). [ 114 ] Mr. Baker raised approximately $5.0 million.

Those making investments were mostly family and friends. [ 115 ] Although it promised a conservative and secure investment strategy, it is clear that, in actuality, Copestone delivered neither. Following Mr. Baker’s death, Mrs. Baker learned that the accounting records of Copestone were a mess. More importantly, none of the loans made by Copestone to Nu-Terra were secured by mortgages. Indeed, they were not subject to written agreements of any kind. At the time of Mr.

Baker’s death, there was virtually no money left in Copestone’s accounts. [ 116 ] In December 2011, Copestone was placed into receivership following an application by two of its investors. The receiver commenced a lengthy and expensive review of Copestone’s activities and initiated a series of applications to recover money that had been lent to Nu-Terra. Litigation against Nu-Terra and various individuals apparently continues to this day. [ 117 ] Mrs. Baker and Copestone investors were unaware of Copestone’s precarious financial position at the time of Mr. Baker’s. Mr.

Baker had painted an optimistic picture in his July 20, 2010 quarterly report to investors: Since inception, Copestone has grown conservatively, has managed investment risk, and has protected investment capital. Investments funds that have been placed to assist builders acquire lots [sic] for construction purposes will be returned as builders acquire private investors placing the properties into a hold position for future development. These funds will then be reinvested into provision of construction financing for existing projects underway, and further property acquisitions.

Copestone’s success to date can also be attributed to the positive business relationships that have been developed with two successful long-term custom home builders. These business relationships, and newly developed relations like them, are paramount to the ongoing successful growth of Copestone. As Copestone acquires more investment capital, more investment opportunities in the form of short- term land acquisition mortgages and longer-term construction financing mortgages become available.

Likewise, Copestone is now also being presented with new opportunities, from its business relationships, to finance residential projects. Copestone is currently under-capitalized and therefore has a limited ability to engage financing for these projects. The total projected investment capital that is required approximates $2.5 million more than Copestone currently has in working investment capital (when taking into consideration return of capital from existing investment projects).

By providing outstanding opportunities for investment growth in a risk-managed environment, Copestone has developing [sic] an excellent reputation with its current investors. It is Copestone’s mission to uphold these high standards for all who choose to include Copestone in their investment portfolios. [ 118 ] The Receiver did not find evidence that Mr. Baker or Mrs. Baker personally profited from Copestone’s activities – whether through Nu-Terra or otherwise. It appears, however, that Mr.

Baker was prepared to report to his investors that Copestone was a healthy and growing company, even though it was in dire straits. It also appears that Copestone investors were prepared to accept such assurances at face value as long as they continued to receive a healthy return on their investment. [ 119 ] Following Mr. Baker’s death, Mrs. Baker tried to keep Copestone afloat. She attempted to find out where Copestone’s loans had gone and what properties were under development. She met with the co-owners of Nu-Terra and legal counsel.

She personally loaned Copestone $100,000 (from life insurance proceeds) in order to make payments to investors in the spring of 2011. [ 120 ] She testified that, in her opinion, Copestone investors would have shown more patience toward Mr. Baker regarding financial issues than they had toward her. She expressed the view that had Mr. Baker lived, he could have saved Copestone through a commercial real estate venture that was under discussion prior to his death – something that she was not able to do. I accept that Mr.

Baker would have tried to save Copestone through this manoeuver and potentially others. [ 121 ] This would likely have extended Copestone’s demise by some period of time; however, in my view, Copestone was destined to fail. It was poorly, if not recklessly, operated. It had no secure investments. It had little cash, having used all of its capital to fund ongoing dividend expectations.

Its last ditch opportunity for survival was based on a land development venture, which, apparently, would have been prohibited under the Income Tax Act , RSC 1985, c 1 (5th Supp) due to its status as a Mortgage Investment Corporation. Mr. Baker’s Future Career Path [ 122 ] At trial, the Plaintiffs took the position that Copestone was doomed to fail, regardless of Mr. Baker’s death. The Plaintiffs argued that, at the time of his death, Mr. Baker was at or very close to a watershed in his professional life.

Upon discovery of the irregularities regarding Copestone, it was probable that Copestone would have been placed into receivership in 2011, which would have forced Mr. Baker to re-evaluate his career goals and pursue a new career. [ 123 ] In support of these arguments, the Plaintiffs submitted a report by vocational psychologist Dr. John Berendt, who identified career options for a person with Mr. Baker’s education and background as a: teacher, mortgage agent, real estate agent, real estate appraiser, network administrator, or help desk support analyst. [ 124 ] The Defendant did not dispute that Mr.

Baker could have pursued alternative careers such as those listed by Dr. Berendt, but argued that it was unlikely that Mr. Baker would have done so. The Defendant offered a variety of more plausible scenarios. [ 125 ] To begin with, the Defendant said that Mr. Baker had expressed no desire to return to teaching. He pointed to the fact that, for the eight years preceding his death, Mr. Baker had chosen to pursue relatively low-paying, entrepreneurial endeavours over a return to the classroom. [ 126 ] In argument, the Defendant painted a bleak picture of Mr. Baker’s career prospects.

He said that in the short term, Mr. Baker likely would have operated Copestone for as long as he could, by whatever means possible, such as pursuing other ventures or drawing on savings to fund dividend payments. The Defendant also argued that if at some point receivership had occurred, Mr. Baker might well have retired and become judgment-proof rather than seeking a new career that would have primarily benefitted his creditors.

He argued that if an alternate career path was assumed, the contingencies surrounding that career (eg. retirement to avoid creditors) were such that the Court should highly discount the probability of a full return to salaried employment. [ 127 ] The purpose of damages in a fatal accident claim is to attempt to put the Plaintiffs in the same financial position they would have been in had the tort not been committed. It is not to place them in the financial position that they might have been in, based on the earning potential of the deceased. [ 128 ] That is not to say that earning capacity is irrelevant.

The capacity to undertake potentially available vocations is a prerequisite to their consideration. However, the inquiry does not stop there. The Court must also consider whether and to what extent the deceased would have been inclined to pursue a particular career path before awarding damages predicated on such a choice. [ 129 ] I do not accept that upon the likely demise of Copestone, Mr. Baker would have returned to teaching. He had walked away from that profession over a decade earlier, choosing instead a series of relatively low-paying jobs in its place.

His desire to do so - notwithstanding the financial sacrifice involved - indicates to me that he had very little inclination to return to the classroom. [ 130 ] For the same reason, I do not accept the position advanced by Ms. Brown that Mr. Baker would have chosen an alternate career based on it yielding similar income to teaching. To quote Ms. Brown’s report: As such, we assume that absent the incident, Mr.

Baker would have derived an income from the operation of his companies consistent with that of his demonstrated earning capacity as a teacher/university graduate, or that he may have returned to his previous job if his self-employed ventures were not producing an income sufficient for him to maintain the standard of living to which he was accustomed. [ 131 ] In my view, Mr. Baker was not driven by the size of his paycheque and would not have selected an alternate career based its income potential.

He was also not driven by his aptitude for a particular profession, as borne out by his perseverance in operating Copestone, notwithstanding his lack of bookkeeping, accounting, and administrative skills. It would be highly speculative to find that Mr. Baker was equipped and would have been inclined to pursue professions such as mortgage agent, real estate agent or land appraiser. I am not prepared to embark on such a speculative exercise as the foundation for an award of damages. [ 132 ] I also reject as speculative, the argument that Mr.

Baker would have retired following the demise of Copestone in an effort to be

judgment-proof and to avoid effectively working for his creditors. It is impossible to predict with any degree of confidence how Mr. Baker might have responded to the potential demise of Copestone: he might have continued to cover up the extent of Copestone’s finances; he may have secured new capital to pay ongoing dividend expectations; he might have worked with Copestone’s investors to recover more of their investment than would have been available following an expensive receivership; or he may have been forced into receivership and years of litigation and spent his time dodging creditors.

There is no reliable way to predict which path he would have taken. [ 133 ] The most reliable indicator of Mr. Baker’s career future - assuming Copestone’s failure - is what he actually did following retirement from teaching; the most probable outcome is that Mr. Baker would have continued a (largely unsuccessful) pursuit of entrepreneurial endeavours. Mr. Baker’s income history between 2001 and 2010, inclusive (the parties have agreed that the year 2000 was an aberration), best represents the financial return associated with such endeavours. [ 134 ] In recognition of the less likely possibility that Mr.

Baker could have sought and obtained a more secure and higher paying job, for the purpose of estimating his future income, I am prepared to assign a positive contingency of 50% to Mr. Baker’s historical income as an entrepreneur, resulting in a projected annual income of $23,099 ($15,399 plus $7,700) in 2010 dollars. i. Calculating Dependency Loss [ 135 ] With Mr. Baker’s income profile determined, the next significant steps in determining the amount of dependency loss are to determine: (1) the percentage of family income that would have been personally consumed by Mr. Baker;

(2) Mr. and Mrs. Baker’s retirement age; and (3) the discount rate to be used in arriving at a lump sum award. [ 136 ] Secondary determinations required include: whether and to what extent the compensation should be discounted for remarriage or divorce; unemployment, mortality and disability; and fringe benefits. ii. Personal Consumption Rate (“PCR”) [ 137 ] In assessing the financial losses suffered by surviving family members, it is necessary to deduct the portion of household expenditures that would have been personally consumed by the decedent, had he or she lived.

That constitutes the personal consumption rate of the deceased. [ 138 ] The methodology for developing a PCR is neither prescribed by statute nor determined in case law. The result is that the issue has been repeatedly litigated, with different approaches being presented by expert economists, and adjudicated on a case-by-case basis. Ms. Brown’s Evidence [ 139 ] Ms. Brown testified that she ordinarily uses a PCR ranging from 12.80% to 18.00% of total income, depending on family size, retirement age and income level.

She applied this range in this case to various income and retirement scenarios to develop an estimate of dependency loss, prior to adjustments for contingencies. [ 140 ] Ms. Brown explained that her PCR calculation was based on data from the combined 2007-2008 surveys of Household Spending. That data was used in a regression analysis that yields the change in expenditure that takes place when household income changes, and when household size shrinks.

She stated that this approach, which builds on work undertaken in the United States, was scrutinized by anonymous referees when she submitted articles for publication in the Journal of Forensic Economics . Mr. Benning’s Evidence [ 141 ] Mr. Benning’s analysis uses a PCR of approximately 24% during the years that Dylan was under the age of majority, and 30% thereafter. It relies on data from the 2000 Survey of Household Spending, as well as work undertaken in Manitoba. According to Mr. Benning, his estimate of Mr.

Baker’s PCR is in line with the PCR typically ascribed by Canadian economists and accepted by Canadian courts. [ 142 ] Mr. Benning stated that Ms. Brown’s methodology is inconsistent with the consensus of Canadian economists, and has several flaws. These flaws include treating family savings (the amount by which net income exceeds expenditures) as income that is indivisible among family members, and assuming that a family would have to purchase almost the same amount of “durable” assets such as recreation equipment following the accident, as they would have in the absence of the accident. Mr.

Benning also criticized Ms. Brown’s allocation of future automobile transportation expenditures to the decedent ($1,200 per year) as being inordinately low, citing, as an example, Canadian Automobile Association’s 2013 Driving Costs, which states that the cost of insurance, licence/registration, and depreciation for a Honda Civic LX was $5,646 per year, with operating costs from $1,744 per year, for 12,000 kilometres driven, to $4,650 per year, for 32,000 kms driven. [ 143 ] Mr. Benning stated that the inadequacy of Ms. Brown’s approach is illustrated by the fact that in the Baker family situation, Mr.

Baker’s expenditures on food, clothing and transportation alone would have been approximately 18% of family expenditures. Hence, Ms. Brown’s estimate of 13% to 18% (depending on family income and Dylan’s age) could not be correct. [ 144 ] In a lengthy surrebuttal report, Ms. Brown took issue with Mr. Benning’s criticisms. As was the case in her primary report, Ms. Brown’s surrebuttal included instances where her own newsletters and articles were relied upon as authority for the propositions she advanced.

She continued to maintain that her estimated annual cost of a second vehicle, $1,200, was reasonable and that depreciation is not an expense that should be included. [ 145 ] Ms. Brown contended that in the absence of evidence regarding Mr. Baker’s use of recreational equipment, it was appropriate to treat such equipment as an indivisible expenditure to maintain the family’s standard of living. She maintained her position that savings

should also be treated as indivisible family expenditures because they are often used to purchase indivisible assets, such as recreational homes, or are transferred to the next generation. She rejected Mr. Benning’s position that savings are typically used in retirement for living expenses and their withdrawal to fund such expenses should be allocated in the same way as income prior to retirement. Conclusions and Comments on Expert Evidence [ 146 ] In my view, the approach taken by Mr. Benning, which uses a PCR of 24% while Dylan was a child, and 30% thereafter, is logical and straightforward.

I prefer it over the approach espoused by Ms. Brown. [ 147 ] In Fullowka v Royal Oak Ventures Inc , 2004 NWTSC 66 , the North West Territories Supreme Court trial judge described Ms. Brown’s PCR formula as “mostly incomprehensible and of little use to the Court” (at para 513). Despite this, Ms. Brown’s PCR methodology was still found to have merit (at para 1016). However, it has also been rejected by the courts: Palmquist v Ziegler , 2010 ABQB 337 . I have considerable difficulty with the methodology itself and the manner in which it was presented.

I am also not satisfied that it reflects the actualities of the Baker household. [ 148 ] Turning first to methodology. I accept Mr. Benning’s evidence that Ms. Brown’s approach understates the decedent’s PCR by assuming that the Baker family would have to purchase almost the same amount of durable items following the accident as it did before. Intuitively, this makes little sense. I also agree with Mr.

Benning that in determining the PCR, it is appropriate to include all automobile costs, including depreciation – particularly where a foundational assumption is that survivors are entitled to maintain the same standard of living post-accident. [ 149 ] I also agree with Mr. Benning’s criticism of Ms. Brown’s approach to savings. As a general proposition, it makes sense to assume that monies saved by a Canadian family facing retirement will generally be used to fund that retirement, including both divisible and indivisible expenditures during retirement years. Had Mr.

Baker not been tragically killed at age 56, both he and his wife would have drawn on family savings to fund retirement expenses and there is no logical reason to assume that they would not have spent that money in the same way as they always had. [ 150 ] I will turn next to the manner in which the expert evidence was presented. Expert witnesses owe a duty to the Court that transcends obligations or allegiances to their client, or business and professional rivalries with opposing experts.

The fundamental obligation of an expert is to assist the Court in understanding scientific or technical issues, and to make accurate findings of fact. [ 151 ] Their evidence “should be and should be seen to be, the independent product of experts uninfluenced as to form or content by the exigencies of litigation”: National Justice Compania Naviera SA v Prudential Assurance Co Ltd (sub nom.

"Ikarian Reefer" (The)), [1993] 2 Lloyd’s Rep 68, p 81-82 (Eng Comm Ct QB Div) , as quoted in Anderson, “Expert Evidence” 2 nd Ed, p 42. [ 152 ] In White Burgess Langille Inman v Abbott and Haliburton Co , 2015 SCC 23 , the Supreme Court of Canada held as follows (para. 10): In my view, expert witnesses have a duty to the court to give fair, objective and non-partisan opinion evidence. They must be aware of this duty and able and willing to carry it out. If they do not meet this threshold requirement, their evidence should not be admitted.

Once this threshold is met, however, concerns about an expert witness’s independence or impartiality should be considered as part of the overall weighing of the costs and benefits of admitting the evidence. This common law approach is, of course, subject to statutory and related provisions which may establish different rules of admissibility. [ 153 ] At trial, it was clear that Ms. Brown and Mr. Benning are competitive and eager to engage both one another and opposing counsel.

This tended to detract from their testimony, and made it difficult to discern whether they fully understood and accepted the obligations owed to the Court. In Ms. Brown’s case, the tendency to become an advocate for her client’s position was particularly apparent in the exchange of reports regarding PCR. [ 154 ] Rebuttal (and surrebuttal) reports are inherently adversarial and a certain amount of latitude can be afforded. In my view, however, the extremely argumentative nature of Ms.

Brown’s surrebuttal report made it difficult to regard that evidence as being directed toward assisting the Court, as opposed to advocating the cause of her client and her own pre-dispositions. Decision on PCR [ 155 ] Another troubling aspect of Ms.

Brown’s evidence that the decedent should be allocated 13 to 18% of household income was that little effort seemed to have been made to examine the reasonableness of that estimate against the actual spending patterns of the Baker household. [ 156 ] Quantum experts may not typically receive information on actual spending, but it is not too much to expect that some effort be made to cross-check such assumptions against the basic features of the family’s spending habits and lifestyle.

For example, the evidence presented was that the Baker family had paid off their mortgage, enjoyed travel and outdoor recreation (such as diving and skiing), and drove late model, luxury vehicles, all of which could well skew personal consumption patterns within the family from statistical averages. [ 157 ] The evidence also showed that not only was Mr.

Baker making a relatively modest income, but, in fact (and unbeknownst to his wife), his entrepreneurial efforts were increasingly jeopardizing the family’s financial future such that even his modest income as reported to Revenue Canada may well have been more than offset by his mounting liabilities. Despite this, Ms. Brown’s evidence would have the Court ascribe to Mr. Baker a PCR that, on the basis of her own

summary of Canadian case law, would be far lower than that typically employed in cases of this nature. In fact, it would be one of the lowest PCRs ever. [ 158 ] For all of these reasons, I accept the evidence of Mr. Benning regarding the Personal Consumption Rate to be used and reject Ms. Brown’s evidence on this issue.

i. Retirement Age [ 159 ] Ms. Brown’s evidence presented alternative retirement age scenarios of 65 and 70 (for Mr. Baker). She assumed that Mrs. Baker would have retired as of July 1, 2014 had the accident not occurred. (This coincides with the date of her actual retirement). [ 160 ] According to Ms. Brown, the average age of retirement for Canadian entrepreneurs from 1999 to 2016 was 66.9. [ 161 ] On instruction of counsel, Mr. Benning assumed that Mr. Baker would have retired at age 62 or 65. At trial, this was explained as coinciding with Mrs.

Baker’s likely retirement age, which was estimated to take place at age 60 or 63. [ 162 ] Given my finding that Mr. Baker would likely have continued to be a self-employed entrepreneur, it is reasonable to expect that his retirement age would have been later than had he returned to work in a salaried position. For the purpose of this decision, I accept Ms. Brown’s evidence and find that Mr. Baker would have retired at age 66.9 (the average age of retirement for self-employed Canadians). I also agree with Ms. Brown that Mrs. Baker would likely retire at age 58.4 when her pension “maxed out”. ii.

Discount Rate [ 163 ] Mr. Benning and Ms. Brown used different discount rates. At trial, Mr. Benning stated that the appropriate “effective” discount rate is 2.5%. This is comprised of a long term return on investment of 3%, less 0.5% productivity growth rate. Ms. Brown advocated for a discount rate of 1% for the first five years and 3% thereafter. She employed a productivity rate of 0.50% (educational services) in one of her income profile scenarios and 1.25% (total economy) in the other two, including scenario A3, which was based in part on Mr

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